Convex – CVX

Convex – CVX crypto

Convex Finance – CVX is a DeFi protocol built on top of the decentralized exchange Curve Finance. The platform offers additional rewards for Curve liquidity providers and stakers as well as a boosted APY.

What is Convex – CVX?

Convex – CVX is a platform that allows Curve’s liquidity providers (LPs) to earn boosted rewards without locking in their CRV tokens.

We briefly summarize how Curve works. 

Curve Finance is a decentralized exchange that offers stablecoins or similar crypto pairs with low impermanent loss to its liquidity providers.

Liquidity providers (LP) are rewarded with CRV tokens that can then be locked (max 4y) in exchange for veCRV (Voted-escrow Curve), which provides various benefits to the holder. 

The principle applies; The longer and more CRV locked, the more income and the higher the APY boost.

Convex provides the maximum boost to anyone who deploys their Curve LP tokens on the platform. Regardless of the number of tokens and with the option to withdraw at any time.

General info about Convex – CVX

Convex Finance is targeting Curve users, consisting of Curve liquidity providers (LP) and CRV stakers. It will offer additional rewards for any CRV participant who secures their tokens on the platform.

Curve Liquidity Providers (LP).

Users can deposit Curve’s LP tokens in the Convex protocol.

When you deposits into one of the Convex Curve liquidity pools, you’ll get Convex LP tokens that offers;

  • Basic APY
  • Portion of transaction fees of Curve Liquidity Pool
  • Boosted CRV rewards
  • Additional CVX tokens

The APY boost is provided by Convex by building a group position which increases the total rewards.

CRV Staking

Convex is not only offering additional rewards for Curve LPs, it will offer them for CRV token holders.

For example, CRV holders don’t have to lock their CRV in exchange for veCRV (Voted-escrow CRV), that gives them a portion of Curve transaction fees, governance and potentially airdrops.

Consequently, CRV holders can stake their tokens into Convex in exchange for cvxCRV tokens.

cvxCRV tokens offer:

  • veCRV reward on transaction fees Curve
  • Possible airdrops for veCRV holders
  • Share of revenue of Convex
  • CVX tokens

It is important to note that when you stake CRV tokens on Convex, the proces is irreversible.

Leaving the Convex ecosystem can be done through exchanging your cvxCRV through the cvxCRV/CRV pool.

Team

The Convex Finance team consists entirely of anonymous developers. Nevertheless, on April 23, 2021, the project was whitelisted by the Curve team and its users.

Whitepaper

For a detailed explanation of how the Convex protocol works, please refer to the whitepaper.

Use case of Convex – CVX

Tokenomics

2 different tokens are characteristic for the Convex platform:

cvxCRV (tokenized veCRV):

Stands at 1:1 ratio for each locked CRV on Convex. It can be staked to receive platform fees(CRV), CVX, and veCRV rewards. As Convex platform revenue increases, more value will be distributed to cvxCRV holders.

Convex Token (CVX):

Convex’s own token, which can be staked to receive a portion of platform fees (cvxCRV). Can also be used for voting for future platform changes.

CVX/CRV ratio reduces every 100k locked CVX

More info here.

Token Distributie

Max supply: 100 million

  • Curve LP rewards 50%
    Based on CRV share on Convex
  • Liquidity mining incentives receive 25%
    Distributed over 4 years. (Incentives for CVX/ETH and cvxCRV/CRV pools)
  • Treasury receives 9.7%
    Vested for 1 year. Will be used for further incentives
  • veCRV receiving 1%
    Claimable airdrop
  • veCRV holders who vote to whitelist Convex receive 1%
    Claimable airdrop
  • Investors receive 3,3%
    Locked for 1 year and becoment to pre-seed boost.
  • Convex Team receives 10%
    Vested 1 year

cvxCRV Staking

cvxCRV can be staked on Convex in exchange for receiving the transaction fee that one would receive for deploying veCRV.

Stakers also receive additional CVX fees.

cvxCRV/CVX Liquidity Pools.

Users can also earn by choosing to provide liquidity in the cvxCRV/CRV or CVX/ETH liquidity pool on Sushiswap.

Sushi LP (SLP) tokens can be staked on Convex Finance for CVX rewards.

Where to buy and sell Convex – CVX?

Convex – CVX can be bought and sold on decentralized exchanges, including;

Uniswap

Sushiswap

cvxCRV/CRV can only be bought and sold on;

Sushiswap

Before one wants to purchase these tokens one will need to purchase Ethereum through a central exchange; This can be done through Binance or Bitvavo

More explanation here.

Social Media Convex – CVX

Twitter
Github
Telegram Chat & Telegram Announcements
Discord
Medium

What do we think about Convex – CVX?

Total Value Locked

After just a few weeks, Convex Finance’s Total Locked Value exceeded $1 billion. Currently, it is around $6 billion TVL, a huge growth as a result of Curve’s popularity. For now, Convex is only deployed on Ethereum mainnet.

Future

Newcomers, coming to the space, can be confused by all the complex elements of Curve Finance.
Convex Finance tries to make participation easier by embodying the money lego aspects of DeFi.

By participating in the Curve ecosystem as a group, Convex can deliver better returns compared to what a single user could do on their own. The more people see the potential of Curve Finance, the bigger Convex Finance will grow

Conclusion about Convex – CVX

Convex Finance is a yield optimizer that helps Curve’s liquidity providers (LPs) and CRV stakers acquire higher yields. The platform aims to ease the complexity of participating on Curve.

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